The 2010 event in which U.S. stocks plunged and quickly recovered within minutes was the Flash Crash.
On May 6, 2010, major U.S. equity indexes dropped rapidly, with the Dow Jones Industrial Average losing nearly 1,000 points before recovering much of the decline. The episode exposed how electronic markets could move at extraordinary speed.
Investigations identified a combination of market stress, automated trading, liquidity withdrawal, and a large sell order as important factors. A British trader, Navinder Singh Sarao, was later accused and convicted in connection with spoofing activity, although the event involved broader market mechanisms. The crash led to circuit breakers and other market-structure reforms.